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tv   After the Bell  FOX Business  February 4, 2015 4:00pm-5:01pm EST

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>> good for airlines. they were all up today. [closing bell ringing] delta with a new partnership with starbucks, david. david: meanwhile the bells ring on wall street. very close to a flat day for the dow. it managed to eke out green arrows but just by a nose. again three stocks keep in mind, walt disney, visa, home depot, they accounted for 90% of the gain when the market was up. without those dow would be in the red. most indices are in the red, by a half percent. "after the bell" starts right now. >> before we get into the meat what happened with today's markets let's head to omaha, nebraska, where liz finished an
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interview with the "oracle of omaha" him seven, warren buffett. liz? liz: he is not make any currency bets. he feels absolutely there are opportunities to buy companies at a discount n europe he is about to buy one. he doesn't say which. i spot him to -- got him to say western europe. what about oil? he wouldn't predict when it would hit a bottom but he feels you have to make an investment in things like specialty chemicals. you know he bought about link ton northern. he is absolutely strong when he thinks keystone should go through. keystone gets the thumbs up from him. what about mortgage rates? what about interest rates? would he, can he, believe that the fed would tighten rates this year as they were supposed to? here's what he had to say about the fed and tightening rates. >> i think it will be very tough to raise rates when you've got what is going on around the world. if europe, has got them at zero
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and you get rates higher in the united states, that would exacerbate a problem with the stronger dollar and fund flow. i think they have got a very tough, be very tough for then to raise rates. liz: is your bet, because you're a betting guy that they won't raise rates? >> i don't bet on that particular but if you asked me whether i think, if i were running the fed i would able to do it, i don't think it will be very feasible to do. i think it would have a lot of international repercussions. liz: that ace no. he would not advise tightening rates right now. he obviously, if you were then to take that comment further, would probably feel that it might derail the very tentative recovery we have, david, which i thought was very significant coming from a guy who also said, he is not interested in any treasurys, not a 30-year, not a 10-year. david: remember where he stand too. a lot of companies he owns or has a part of sell overseas. a stronger dollar hurts exports.
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it is already strong enough. now with the european central bank about to lower value of their currency even more that would hurt his companies even more. so he has an interest in that as well. let's get into what happened today with the market. we have ron weiner from rdm financial group. why now is the time to diversify your investment portfolio. matt genn from royal oak financial group. he says now is the time to stay fully invested. he has two picks for you and scott shellady in the pits of the cme. scott, down 7% yesterday or up 7% yesterday and down 8% today. this must be driving traders nuts. >> you know what? this is not just oil. this is the post-qe world we trade in all day long. once we take away quantitative easing and accommodation, investors don't have the buy stocks they're going up. investors are skiddish and more
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risk-averse. a lot are not well-capitalized. when they see the risk they are like lemmings getting in and out and it will happen all year long. david: liz we have earnings today from green mountain. tracy? >> it was a miss on both ends. earnings came in at8 cents adjusted. they were looking for 89 cents. revenue a little low, 1.39 billion. don't forget, david at end of the quarter they had to recall 7 million of single brewing machines because of burn hazard. we have to learn more. it is a miss on green mountain. david: it is trading down after-hours. liz, back to you, get in on this market panel. liz: i want to because matt's perspective is in part to warren that you believe it is time to be fully invested. where? mr. buffett obviously feels it is so much better to be in equities right now and not treasurys where the yield is
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rather thin i guess you could say? >> yeah, absolutely. we definitely like equities. the yield is in the equities with the dividend. to go into treasurys or perhaps even cds with banks is financial suicide. there simply is no return. i'm a bit different than warren. we don't have the purchasing power he does. we're really focused in the united states. going into 2015 i just felt that it was probably wise to pick up our marbles and go home, given everything that has bonn on in europe and japan and russia. why not focus right here where we know we have some growth, we know we have some momentum. so we're really interested in u.s. domiciled companies that have growth, perhaps consumer driven growth, given lower gasoline. we're really excited about that. but absolutely we want to be fully invested in equities. you need to really coach your clients along with this and help them understand why.
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because everyone is fearful. when you're fearful, you're hesitant. hesitation you will make bad decisions. so we're really been engaged with our clients saying hey, look, here is why we need to be here. so hang in there. it will be okay. david: but, matt, you have a big interest in the united states. i understand that with what is happening in the world, what is happening in asia, particularly what is happening in europe. by the way as we were going on the air, the european central bank says it can not assume a successful conclusion to the greek bailout. there are a lot of problems. ron, i'm wondering how long the u.s., we're growing at the moment, not as much as we like, how much longer can we carry the world on our shoulders? >> first, bull markets don't die of old age. they die of recessions. they die of the fed raising rates too fast. i think the u.s. will be fine. it is the most stable and safe place. but the truth is a as liz said in the beginning you have to diversify a little. marriage manners were the worst
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farmers two years in a row, three years in a row. you have to nibble at that. warren said it perfectly. buying some in europe. not a lot. i think you nibble at it. u.s. is dependent on exports for only 14%. i think the u.s. is fine. i think what you got to do, you have to buy what's low and what's got value. the truth is, the u.s. is fairly valued. we think it is fine. mostly large cap u.s. but you have to start nibbling at the edges and that would be emerging markets to some extent. mostly betting on the consumer in marriage managers. because that is going to double in the next 20 years. that is megamarket. but i think europe is also, as warren said, i think europe is probably a place you start nibbling a little bit. liz: that was interesting, ron. i want to bring us back to scott shellady because ron also mentioned the consumer. warren is making this massive bet here with the brand new
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nebraska furniture mart in dallas-ft. worth. it will be largest freestanding furniture store in the world, bigger than any ikea. that is bet early on perhaps great housing numbe sales, things like that. what do you see when you have people still rushing into the treasurys because they're scared? which is exactly what ron and warren would say, don't do? >> well, the reason why the rushing into treasurys, go look at euro yen screen, a euro swiss screen or libor screen. look what their rates are, look what the five and 10-year rates are. suddenly the makes the u.s. look fat, number one. number two, last year, because i say buy a 10-year bond doesn't mean i will hold it for 10 years and lend my money to the government for 1.7%. what if i want it tore six months or 12 months? last year, depending what bond you were in returned 25% and stock market returned 11%.
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last year bonds were a better bet. relative value, being long our bonds, not only bonds i think equity market will have some legs to it. i like our bond because our rates compared to the rest of the world are relatively high on the rhetoric of a rate hike. i don't think it will happen. this might be your time. take advantage of it. david: let's talk about rates. matt you just heard warren buffett say he doesn't think there will be a rate hike this year. jack welch said the same thing today. anthony scaramucci has been saying that for months. you think there will be a rate hike in sometime in summer, july, august, around then. if it doesn't happen are we in trouble? >> i don't know if we'll be in trouble but, gosh, i would like to see them stick a marker out there, perhaps 25 basis points, 50 bisys points. the reason i would like to see that, i want to see reaction in the market. i want to see how if things get jolted -- david: want to see if we can stand on our own two feet? >> yeah, exactly.
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it might really support us and actually catapult us into the next growth period. we need to get back to a normal economy and that's not going to happen until we get rates back in line. we need to drop a marker and we need to do it this summer and i think for the credibility of the fed too. they need to follow through with it. if they withdraw, it could potentially cause more fear in the markets and we could see some bad things happen. david: well, they may in fact be in a trap already. that may be one of problems but we shall see. ron, matt, scott, great group. of the billions in the u.s., billions into europe and billionses into japan and billions into china, central banks all around the world printing presses are operating at full speed. do they know what they're doing? what is the endgame? there are trillions in cash out there. what good are they doing? wheel talk about that with the panel. oil also wiping out all of yesterday's gains and falling
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more than 8%. why the volatility? our panel goes head-to-head in search of surprising answers. we're back with liz in omaha who has more with the oracle there. liz? liz: dave, nothing was off limits in my conversation with warren buffett in the last hour. yes, he says he has beaten prostate cancer. he says do not expect the federal reserve to tight eprates this year. seas if it were him he could not do it. plus moody's, the ratings agency embattled with an investigation right now, he is selling his multimillion-dollar stake. what about poke cola? we'll have more live from omaha. the ♪ the future of the market is never clear. but at t. rowe price, we can help guide your retirement savings. our experience is one reason 100% of our retirement funds beat their 10-year lipper averages. so wherever your long-term goals take you, we can help you feel confident.
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>> welcome back to "after the bell." i am tracy byrnes. we earnings from 21st century fox. earnings came in 53 cents a share. that is beat. revenue also a beat. $8.06 billion. expectations were for 7.63 billion. this is fiscal second-quarter earnings. the stock was up about 2.7% after-hours. david, back to you. david: thank you very much, tracy. well our next guest said this week central banks all over the world are steeped in denial about the risks they face. i'm quoting him now, like
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lemmings at the cliff's edge. we heard such warnings before but not from the likes of stephen roach, senior fellow at yale university and former chairman of morgan stanley asia and professor roach joins us now. what a provocative statement, professor. i have to ask what are the biggest riskses that they face the central banks, particularly the risks they have put us front and center in. >> well, david, i wrote this article in, on the project syndicate platform to provoke discussion over the full intent of this global experiment with quantitative easing. the fed has injected 3 1/2 trillion dollars of liquidity into the system, well in excess of the expansion of nominal gdp over the qe period. other central banks rushing to follow suit. the bank of japan now of course, the european central bank, and i
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think what we're left with here is that they're good at creating the money to buy the sovereign debt to inject liquidity into the system but will they ever withdraw this liquidity and are we destined to have a world financial markets that now has so much excess liquidity sloshing around in it, the likelihood of further asset bubbles or other financial, financially-engineered dislocations is much higher than otherwise might be the case. that is the point i tried to make. david: you tried to say, professor, that we're on the edge of a cliff. what cliff are we about to go off off? what happens? is there some bubble about to explode or what? >> there, you know, in the world that i live in, david, there are cliffs everywhere and, i guess. david: you have to watch your step. >> you have to pick your cliff, right? we had fiscal cliffs.
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we had housing cliffs. equity market cliffs, bond cliffs, you name it, we've had it. but in a liquidity-driven world which is what qe is all about the likelihood of more cliffs is much higher than what otherwise might be the case. central banks are not focused on the financial stability ramifications of what they have done by leading us down the road to this massive qe-induced injection of liquidity. david: right. >> you see no -- david: let me stop you there, professor, if i can because we don't have much time. >> sure. david: here is is one of the problems they face, i'm sure you know this, jack welch and warren buffett talked about it today, the dollar is very strong right now because we're pulling back a little, at least from qe. we're still holding on to our portfolio but we're not buying that many bond right now. so the dollar is getting stronger. if they raise rates in this environment, the dollar will get even stronger which is going to hurt our exporters even harder
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and that's why jack welch, and i'm quoting him, he said i think the fed would be crazy to raise rates at this point with the dollar where it is of the warren buffett says much of the same. anthony scaramucci and others. what do you say? >> look, we're never lacking for brilliance from these incredible industrialists, but this is perfect example of how central banks set a trap they can't extricate themselves from. more stay with interest rates and more qe they inject, harder it is to wean the patient from the drug and narcotic. a disciplined central banker would say, okay, extraordinary conditions that dictated this approach have now subsided. it is time to go back to a more normal set of policies before it is too late. david: all right. here, again -- >> we need a paul volcker today, david. david: yeah, paul volcker. there is only one of him.
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unfortunately -- >> unfortunately that is true. david: i don't see anyone in the wings. richard fisher, by the way is leaving the fed. here is another parish stuck on this narcotic as you put it and that is the federal government. the federal government now pays very low rates for its own debt. it is still paying what, about $200 billion in debt service but if rates go up at all, suddenly that could double, or even triple. which would put us as a nation, at risk of default. that is another problem that the fed faces. >> yeah, but that, david, that's the point. the federal government gets away with that because the federal reserve with zero interest rate policy subsidizes their borrowing costs. so zero interest rates is a foil for fiscal irresponsibility in the united states. if we had more normalized borrowing costs maybe we would bring our budget deficit under better control, more effectively rather than have to deal with what you just described another cliff, borrowing cliff. david: professor, you make a lot
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of common sense. i wish people listen to you inside the beltway. stephen roach, yale university. thanks very much for being with us. >> thank you, david. david: argentina is reeling today on news a prosecutor who was shot to death had actually written up a draft indictment of president christina kirschner and her foreign minister last june. the prosecutor believed argentine officials were covering up iran's role in deadly terror attack in exchange a grain with iran. the draft indictment calling for the president's arrest was discovered in a garbage bin behind the dead prosecutor's apartment. it was not included in the prosecutor's report on the scandal submitted by him two days before his death. a week before he died he said he could be killed for releasing the report. president kish mucher in's assistant said he probably
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committed suicide. that was so ridiculed bit press that the president came out and said he probably was murdered. the president can only be arrested if congress lifted immunity granted to them as members executive. that is unlikely to happen. liz is in omaha and spoke exclusively with warren buffett for his 50th year at berkshire hathaway. we'll hear more from her interview coming up. general motors profits soaredded from the fourth quarter of previous year, with a year permeated with recalls. what is behind the buck? how could they profit so much with some recalls? ♪
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it's a fact. kind of like mute buttons equal danger. ...that sound good? not being on this phone call sounds good. it's not muted. was that you jason? it was geoffrey! it was jason. it could've been brenda. david: these wild swings in the price of oil over the past couple days have been historic. the question is, what beyond issues of supply and demand is going on here? let's bring in the panel. john tamny, real clear markets editor, star of to on fox, one
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of the stars of "forbes on fox." fox business's tracy byrnes is with us as well. john besides supply and demand, we understand saudis are pumping a lot of oil, what is going on? >> it is simple. the dollar is stronger of late really last few years. it buys more. so when the dollar buys more the oil which it is priced can buy a lot more oil. oil has become cheaper. evidence supporting this, if you look throughout history, computers, cars, sell phones, when their prices drop the entrepreneurs who bring about the price drops are enriched. with oil, every time the price drops we wipe out industry. that is evident that the price was artificially high when the dollar was weak. the price is much lower now because the dollar is strong. david: that is an interesting case. todd, does he make it? >> i'm not quite so sure. i mean oil, we see oil, it spiked up in the summer based on fear. there was a fear premium built in, easy to say based on fear. now oil sold off because of
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stronger dollar, lack of demand. economies are weaker which creates less of a demand. david: let me put it real simple. is it what john is saying strength of dollar is what is driving down price of oil or is it supply and demand, the fact that saudis are producing more oil? >> it is combination of both. it is not just once answer. oil since 1961 is up 650% versus normal housing. david: tracy. >> i think definitely a combination of both. with oil being so high at one point we kind of moved ourself off on being dependent on foreign countries that hate us. there has been good things, not to mention the consumers wallets. the fact we're energy independent is big bonus from all that happened. david: there is a lot of good come out of this, no doubt. gm reporting an astounding 91% jump in profits last quarter. so is this just an oil bounce or is this a sign the economy is really turning around? tracy, what do you think? >> i think they're giving them
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away for free, david. 0% financing, you have to be kidding me. david: true. >> with all respect to the little green vehicles you can't fit anything in it. we're still a society that needs stuff and has kids and needs to go places. with oil down, it was a no-brainer buy an suv. david: todd, gas-guzzlers are selling. >> it is gas-guzzlers. she said 0% finance, you realize the average guy with 0% finance paying all 7% with all the deductions. we're pay by the month society. go out, i can afford it by the month i'm going to get it. now they're really paying 7% interest versus zero that you think. get none of the rebates. get none hold back. get no extra money. pay cash for the job, save 6 or 7,000 off the top. david: john is this sign of economy getting better? is this sign of individual issues like low interest rates and price of gas being so cheap? >> well, yeah, a stronger dollar means cheaper oil. so that you get a stronger economy with that. what do the big three do best?
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they make big gas-guzzlers. that is their comparative advantage. so with oil cheap, their ability to move cars is much, much greater. david: tracy, are these electric cars ever going anywhere without government support? >> i don't know. i don't know. i know i'm still deathly afraid to get near one. i would be the girl who forgets to plug it in. they're trying and i, respect that but it is going to take a lot to convince people. david, look, gm is the worst performing stock of the year. so it has a long way to go before people are pulling out the balloons and streamers. david: right. i don't respect government subsidies. that, if they can make it on their own, fine but i don't think they can. coming up the u.s. unemployment rate may be down to 5.6%, before we celebrate too much could this number be very misleading? the gallup boss thinks some we'll be discussing this next. we're heading back to liz in omaha, who has more from the oracle of liz? liz: well, he now is worth
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$71 billion. that is his personal fortune. so he is the world's second richest man. what is the last thing he would buy, that he would commit his money to? that plus, why he really feels janet yellen is now constrained at fed about raising rates. what will hold her back for maybe an entire year. stay tuned, we're coming back live from omaha, nebraska. ♪ ♪ by 1914 the dodge brothers quit the ford motor company and set out on their own. they believed in more, than the assembly line. they believed driving was a holy endeavor. a hundred years later, the dodge brothers spirit lives on.
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liz: 10,000 invested back in 1965 in warren buffett's company, berkshire hathaway, would equal about $175 million today. he has made all kind of bets. we're here at nebraska furniture mart where he just invested half a trillion dollars to build a bigger better one here in dallas. what does that say where his mind is at? where he thinks and where he is putting his money could help make you money. here are some best parts of our hour-long exclusive interview we just conducted with the "oracle of omaha." >> mortgages are, buying a house today really makes sense. i'm not saying that we have real estate brokerage firms because it is not that big relative to berkshire. i'm just saying when you can borrow money 4% 30 years, a good deal for you keep it 30 years and for some reason rates go lower refi and call it after
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after 30 minutes it's a wonderful deal. liz: do you think keystone eventually becomes operational and is passed? >> i think it should, yeah. liz: do you see any bargains in russia? are you looking? >> no. the answer, we do some business in russia but, we, bought some foreign securities and we would like to buy more businesses around the world. we're probably going to buy a small business in europe but, i would love to buy big ones. >> so of course he owns $107 billion worth of stock. i wanted to ask you about one name, moody's. you still own a big chunk of moody's. >> yeah, that's true. liz: i have to ask why? because, when you look at these companies that have been the ratings agencies, s&p just settled, from the crisis era situation. you know moody's might be next. why are you still holding on to moody's? >> it's a fantastic business. is s&p incidentally. they're payinging a a big fine.
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s&p is wonderful business. takes no capital. it has pricing flexibility. i can't, if i sell a bond issue i sell one in another month or something, i need moody's rating and standard & poor's rating and i can't negotiate with them. >> won't sell any of your moody's stakes. >> we haven't for a long time. we have $2 billion worth. liz: your biggest stake is coca-cola. >> wells fargo is the biggest but coke is up there. liz: coke, one of your business loves, but warren, it is losing that important connection it had with its customer versus the product. it is struggling. i stopped drinking diet coke. i hear a lot of people saying i'm trying not to do that anymore. you may drink it every but are you worried that the company lost its way a little bit? they're rolling out fancy milk and things like that. >> there are 1.9 billion, eight-ounce he servings of a coca-cola product in the world today. it has gone up almost every year
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since 1186. that is true there is more publicity in this country. i'm 84 years old. in my adult life type one quarter all calories i con consumed come from coals la. liz: you're scaring me. >> i'm feeling great. when i pass on i think the coca-cola company should take my body around this country, drag it around and, i made it to 100 nothing by drinking coke. liz: on a a wells fargo stagecoach. >> sure. with the gekko along. >> throw all the logos in. you won't skim any of the foam off top of your shares, even if you need money to buy something you like more? >> we have 60 billion in cash. we're unlikely to need the money. we've gone since 1988 never sold a share. never sold a share of berkshire my settle never sold a share of coca-cola. liz: they want to know the suessi pla wren. i ow y sd erere tee oplen anvepeway.
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>> n in a evelo. i jt jo abothat itisn yo hea no. thirecrs ow. wealk outllheime. >>ut, pck ou gg ab rit ofthe bt. hes 51. he rs beshirhathay ergy he i a mieste guyathe mont wh the bfett fthfu ge ippeup tey s his nme a lo yea welle wodbeterricbut, i wi wri mor abtt inhe anal rort. z: tre iometnghere for at i am su. y ar't y pang a vide? wi youver ay dvide? >> iactuly cer thain t anal rort too. i' prey scific out tt. liz: sometng tells me the heels a we'll do whatever is the mostgi. very simple. liz: there is a lot going n thisount. wee heing tolecons. you have said right ohe bat, hillary llun and hillary will win. do you still feel that way? >> i think probabilities are very high she will run and if
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she runs she will win. liz: you will support her? >> 100%. liz: jeb bush is centrist guy. he is smart. >> i think he is a fine guy but i'm for hillary. liz: do you think it will be those two against each other? >> i am no better than anybody else on that. liz: you know, as we look all that is out there, you read every day, is there one often than not say he or she got that right? >> no. probably wouldn't say that about a columnist. the columnist i enjoy the most is gail collins. liz: sure. >> i think she is terrific. never met her. in addition to being very funny she is very, very smart. liz: gail collins, just made her day. next 50 years, warren. >> right. liz: how long are you sticking around? >> i hope a long time. as long as i can keep drinking coca-cola, no telling how long i will last. >> he drinks coke. he eats steak.
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he adds salt to the steak, david. pretty unbelievable. live from omaha, an american dream story you don't want to miss from russian immigrant, pennyless, to signing a $60 million deal with a simple handshake with warren buffett. an incredible story, dave. stay tuned. david:4 years old and half the calories in his life have been soft drinks. i love it. i just love it. what a character. also ahead, the fcc just came out with its plans to regulate the internet as a public utility. so what happens to the internet if they succeed? we're all awaiting the big friday jobs report but the chairman of gallup weighing in today saying the figure will most likely be, and i'm quoting him, a lie. is he right? we're back with the panel for debate on that. ♪
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the real question that needs to be asked is "what is it that we can do that is impactful?" what the cloud enables is computing to empower cancer researchers. it used to take two weeks to sequence and analyze a genome; with the microsoft cloud we can analyze 100 per day. whatever i can do to help compute a cure for cancer, that's what i'd like to do.
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david: fcc chairman tom wheeler laying out his plan for fcc to regulate the internet as if it were a utility. surprisingly cable companies getting a boost on the news so what is up with that? let's bring in our panel. john tamny, todd horowitz, tracy byrnes. john, what is going on here? >> this scary thought at first. we want faster internet and only way to get that if you allow
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profits to rein in the industry. i think stocks are rallying, they think whatever wheeler is saying is not going to come to pass. that is very positive sign profits will still be a story here. david: i hope john is right. i don't want to see fcc regulate internet. this is in "wired" magazine. there will be no rate regulation, no tariffs, no last minute unbundling. so are they being lured into believing that fcc regulation will mean no changes? >> they're being lured in but again we know one thing they're looking for way to tax, government looks for way to get money on top of this. we know another thing. cable companies and all providers will tax you and me if they get it passed. david: bingo. tracy. >> todd is dead on. this has nothing to do with intellectual property or freedom of speech or anything this country was founded on. it is on politicians getting their dirty hand on more money. the internet is not the place to do it.
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this is where so many companies grew. aol, you name it, they all came out of freedom of movement on the internet. to have the government's slimy hands all over it would be terrible. david: nobody could say it better, tracy. that's it. friday we get january unemployment numbers. the chairman of gallup weighing in on the subject, calling our current 5.6% unemployment figure a big lie. todd, is it? >> it is an absolute big lie because all they're doing is giving you artificial numbers, if you went to look at the actual report from the bureau of labor statistics you see our participating rate is the lowest since 197. jobs we're creating, they are no good. look what happened to schlumberger, they lay off 9400 workers. that is equal to five workers they're hiring of minimum wage service jobs. we're not creating real jobs because we have no more capitalist system because of all government regulation. david: john? >> of course it is a flawed and false number but i think they overstate it. i think this is positive sign, a lot of people happily hide their
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employment from the government. there is a lot of business startups that don't count yet. michael bloomberg was surely unemployed for some time while creating bloomberg lp. so it is artificially high. david: that might be, but, tracy usually third world companies, or countries have big underground economies, black market economies, not a country like ours. usually regulations were low enough and taxes were low enough to be above-ground there. are a lot of costs being underground. >> we know that is not true anymore. the costs being above-ground are almost worse. i find it insulting people unemployed and stopped looking they just don't count anymore. they're not even included in the number. this is very typical of the government to brush you aside, we're done with you, we'll move on. we'll find a new number. again, we all took statistics. you can make numbers look as pretty as you want. david: tracy, great last words. thank you all. john tamny, todd horowitz and of course tracy byrnes. with the dow giving up most of
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the gains into the close and oil falling back below $50 a barrel, what could have biggest impact on your portfolio tomorrow? we are back with the number one thing to watch for tomorrow. also, we're heading back to liz in omaha. liz? liz: well, i'll tell you something, david, if you start a business with the clothes off your backs, that is what rose did when she started nebraska furniture mart with the furniture in her house. she started to sell it because she had no money. it turned into this today. and guess what? here at the nebraska furniture mart, as they continue to grow, fourth generation, ryan is here joining us to talk about why he left his old job to come home and work back at the nebraska furniture mart. there he is. he is coming to talk to us about their new big effort in texas. a texas-style nebraska furniture mart, coming up. >> hi, everybody, i'm gerri willis. coming up on my show at the top of the hour, the former governor of indiana and current president
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of purdue university, mitch daniels, explains how he is revolutionizing the cost of higher education. that is just one of the big consumer stories coming up on "the willis report" in just a few minutes. what am i thinking about? foreign markets. asian debt that recognizes the shift in the global economy. you know, the kind that capitalizes on diversity across the credit spectrum and gets exposure to frontier and emerging markets. if you convert 4-quarter p/e of the s&p 500, its yield is doing a lot better... if you've had to become your own investment expert, maybe it's time for bny mellon, a different kind of wealth manager ...and black swans are unpredictable. it's working for new york state. already 55 companies are investing over $98 million dollars, and creating over 2100 jobs. from long island to all across upstate new york, more businesses are coming to new york. they are paying no property taxes, no corporate taxes, no sales taxes.
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or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. why pause the moment? ask your doctor about cialis for daily use. for a free 30-tablet trial go to you stay up. you listen. you laugh. you worry. you do whatever it takes to take care of your family. and when it's time to plan for your family's future, we're here for you. we're legalzoom, and for over 10 years we've helped families just like yours with wills and living trusts. so when you're ready, start with us. doing the right thing has never been easier. legalzoom. legal help is here. liz: how has warren buffett cobbled together amazing companies, eight of which if spun off would be part of
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fortune 500? that is how big many of his companies are. start with one of them the american dream. rose blunkon arrived in the united states in 1917 from russia, nearly pennyless. 20 years later she founded the nebraska furniture mart in her basement. in 1933, she use ad simple handshake, sold 90% stake in her company for warren buffett for offin. with us her great-grandson, ryan. you still work here today? >> absolutely. wake up every morning and very excited about what i do. gerri: i can not believe your grandmother. what a story she told. starting selling her own furniture and a real trick, this is picture of her shaking hand with warren buffett. bought on the business on a handshake. didn't lookly through the books, right? >> that's correct. ultimately was a one page purchase agreement. a study in business cases.
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gerri: one page agreement. >> worked out great for both sides. gerri: what about the history now. going way back she got hauled before a commission in nebraska for having prices that were too cheap, too low. >> correct. antitrade lawsuit. some of her competitors were upset with her. she would sell everything at 10% margin. they couldn't compete with. that they took her to court. mrs. b versus what was six, sophisticated attorneys and her broken english won. and it was a big break for nebraska furniture mart because after the judge ruled in her favor, he, came in, bought a whole house full of carpet. >> liz: the judge? >> the judge did, you got it. they rote wrote big article in the herald. liz: he knew where to get the best price. >> no question about it. liz: we go to the brand new store, fox business with exclusive video, the store opens in dallas-ft. worth, 32 football fields long.
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a nebraska furniture mart will rival any furniture company, correct? >> certainly. liz: what will it be like? >> it will be an experience unlike one today. we'll overwhelm a customer on all their expectations. it is large. it is one-top shop. we have everything that you need for your home. furniture, flooring, appliances electronics. liz: 1 to 15 million square footwear house. the store is how many square feet? >> 1.million total. 5,678,960,000 retail. we'll have 500,000 skus. liz: in true rose conform, all prices checked twice a day via infrared thing, so what, you can lower prices if you hear some other company has low prices too? >> that's correct. we have digital price tags. so we'll go out to 18 main retail sites. we check thousands of our skews. we update them on digital price tags to make sure they're lower
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than somebody else. liz: i asked warren last hour, he said, liz, no one win undercut our prices. we won't let that happen. he says you do a billion in sales. >> high numbers. but i never bet against mr. buffett. liz: he is trying to get you guys to reach beyond your grasp. what does you say, great-grandson, come back here. you're still in real estate. you're turning it into a huge project in texas. what does it say about the values of your grandmother and what she built and what warren recognized? >> you know what. we have an amazing story here. the faith and confidence 6 berkshire and warren's backing is like a participate you can only dream of. liz: in the end you can say the immigrant spirit is alive and kicking. here you are four generations later still working hard. >> certainly. liz: congratulations. when is the opening of the big dallas store? >> spring of 2015. my coanchor,, loves a par begin.
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he will take a trip to tes. dad, iyou nd a lorric ey wl chgetight ere. z: y're rght. >> i am scott. i not only love a bargain. it is great american dream story. you can tell he was raised by good families. who is he to argue with warren buffett. a billion dollars. buffett sees it coming. liz, great stuff all day. really terrific interview. liz: we sign off from omaha, nebraska, the big exclusive, by the way if you want to see the whole interview with warren, he made a lot of news. the wires are pick up on a whole bunch of stuff, has it. david: main thing, one quarter of his diet has been soft drinks his whole life. healthy man at 84. liz, have a safe trip back. thank you very much. timeor the number horowitz, average joe founder. isn't great to hear the american
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stories? >> i love, the great american dream. david: it is still possible, right? >> absolutely. david: for all the crap that we talk about goes on with this economy? >> absolutely. capitalism, we'll get back to it and everybody will have a chance to fail. to be successful you have to have the chance. david: more business leaders say they learn more from failure than success. number one thing to watch tomorrow? >> with today's action the volatility index. we have a lot of price volatility, but not much action in the vix. watch volatility index combined with tape action tomorrow heading into the jobs number on friday. as the jobs comes in, vix says it is upper end of the range. 17,000, 18,000. volatility index will tell the real story. david: by the way, are you surprised an 8% drop in oil today didn't bring the market down with it? ended day down a little bit but not a lot? >> not surprising. oil itself had such a big rally, it was a real big short-covering squeeze we saw.
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now we'll see how it will trade. oil will be fine about 47, 48. david: 4is the bottom, according to todd -- 47. "willis report" is next. we'll see you tomorrow. gerri: hello, everybody, i'm gerri willis. this is the "willis report," the show where consumers are our business. drivers have enjoyed a record decline in gas prices. >> 1.99 and i like it. >> but it's not opec threatening to push prices up again. it's a union dispute at refineries around the country. we'll have the details. >> if something doesn't break free, it will spread. gerri: is the government lying about the unemployment numbers? one influential ceo is causing a stir with his comments. after republicans in the house vote to repeal obamacare, what's their plan for a replacement? the alabama congressman leading that charge will tell us. >> my legislation instructs the appropriate house committees to move forward w


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